<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
- -------------------------------------------------------------------------------
FORM 10-Q
(Mark one)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13
OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended October 31, 1995
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR
OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number 2-23666
------------------------------
CASCADE CORPORATION
AN OREGON CORPORATION
I.R.S. Employer Identification Number 93-0136592
2020 S.W. 4th Avenue
Portland, Oregon 97201
(503) 227-0024
- -------------------------------------------------------------------------------
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. YES X NO
---
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date: common shares outstanding at
November 30, 1995, 11,928,104, net of treasury shares.
<PAGE>
CASCADE CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENT OF INCOME AND RETAINED EARNINGS
(in thousands, except per share and average share figures)
<TABLE>
<CAPTION>
Three months ended Nine months ended
October 31 October 31
-------------------- ---------------------
1995 1994 1995 1994
------- ------- -------- --------
<S> <C> <C> <C> <C>
Net sales $ 58,480 $ 47,360 $ 174,280 $133,710
------- ------- -------- -------
Costs and expenses:
Cost of goods sold, excluding depreciation 38,605 30,315 114,470 85,650
Depreciation 2,315 2,025 7,360 6,125
Selling and administrative expenses 9,585 9,430 29,065 27,245
Interest expense, net 10 (10) 170 15
Other expense, net 1,145 525 2,450 1,565
------- ------- -------- -------
51,660 42,285 153,515 120,600
------- ------- -------- -------
Income before taxes 6,820 5,075 20,765 13,110
Income taxes 2,140 1,750 7,190 4,585
------- ------- -------- -------
Net income 4,680 3,325 13,575 8,525
Retained earnings, beginning of period 86,643 78,660 79,910 75,262
Cash dividends (1,081) (901) (3,243) (2,703)
------- ------- -------- -------
Retained earnings, end of period $ 90,242 $ 81,084 $ 90,242 $ 81,084
------- ------- -------- -------
------- ------- -------- -------
Net income per share $ .39 $ .28 $ 1.13 $ .71
------- ------- -------- --------
------- ------- -------- --------
Dividends per share $ .09 $ .075 $ .27 $ .225
------- ------- -------- -------
------- ------- -------- -------
</TABLE>
(Based on 12,009,904 common shares outstanding)
<PAGE>
CASCADE CORPORATION AND SUBSIDIARY COMPANIES
PART 1
CONSOLIDATED BALANCE SHEET
(in thousands)
<TABLE>
<CAPTION>
Fiscal
Year ended
October 31, January 31
1995 1995
---------- ----------
<S> <C> <C>
Assets
Current assets:
Cash and cash equivalents $ 22,620 $ 17,203
Accounts receivable, less allowance
for doubtful accounts of $387 and $265 41,351 35,277
Inventories, at average cost
which is lower than market:
Finished goods and components 15,831 13,934
Goods in process 4,040 3,148
Raw materials 5,276 3,985
--------- ---------
25,147 21,067
Income taxes 151
Prepaid expenses 648 919
--------- ---------
Total current assets 89,766 74,617
Property, plant and equipment, at cost less
accumulated depreciation 64,475 60,607
Other assets 2,620 1,885
--------- ---------
Total assets $ 156,861 $ 137,109
--------- ---------
--------- ---------
Liabilities and Shareholders' Equity
Current liabilities:
Notes payable to banks $ 5,864 $ 5,812
Current portion of long-term debt 737 243
Accounts payable 17,987 16,149
Accrued payroll and payroll taxes 4,938 4,227
Other accrued expenses 4,011 7,365
Income taxes 2,013
--------- ---------
Total current liabilities 35,550 33,796
Long-term debt 13,957 7,809
Deferred income taxes 3,646 4,058
Other liabilities 2,954 2,908
--------- ---------
Total liabilities 56,107 48,571
--------- ---------
Shareholders' equity:
Common stock, $.50 par value,
authorized 20,000,000 shares --
issued 12,391,408 shares 6,196 6,196
Additional paid-in capital 2,045 2,045
Retained earnings 90,242 79,910
Cumulative foreign currency
translation adjustments 2,957 1,073
Treasury stock, at cost
(381,504 shares common) (686) (686)
--------- ---------
Total shareholders' equity 100,754 88,538
Total liabilities and --------- ---------
shareholders' equity $ 156,861 $ 137,109
--------- ---------
--------- ---------
</TABLE>
*For the nine months ended October 31, 1995, the cumulative translation
adjustment account reflects a credit of $1,884 resulting from translation
adjustments.
<PAGE>
CASCADE CORPORATION AND SUBSIDIARY COMPANIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(in thousands)
<TABLE>
<CAPTION>
Nine months ended
October 31
----------------------
1995 1994
-------- --------
<S> <C> <C>
Cash flows from operating activities:
Net Income $ 13,575 $ 8,525
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation 7,360 6,125
Deferred income taxes (487) (23)
Changes in operating assets and liabilities:
Accounts receivable (6,074) (7,769)
Inventories (4,080) (1,694)
Prepaid expenses 271 68
Account payable and accrued expenses (805) 1,142
Income taxes 2,164 904
Other liabilities 46 45
-------- --------
Net cash provided by operations 11,970 7,323
-------- --------
Cash flows from investment activities:
Acquisitions of property, plant and equipment (9,037) (15,698)
Other assets (735) (191)
-------- --------
Net cash used in investing activities (9,772) (15,889)
-------- --------
Cash flows from financing activities:
Long-term debt, including current portion 6,033 6,155
Notes payable to banks 52 3,200
Cash dividends (3,243) (2,703)
-------- --------
Net cash provided by financing activities 2,842 6,652
-------- --------
Effect of exchange rate changes 377 1,521
-------- --------
Increase (decrease) in cash and cash equivalents 5,417 (393)
Cash and cash equivalents at
beginning of year 17,203 12,617
-------- --------
Cash and cash equivalents at end of period $ 22,620 $ 12,224
-------- --------
-------- --------
Supplemental disclosure of cash flow information:
Cash paid during the period for:
Interest $ 854 $ 169
Income taxes $ 5,355 $ 7,185
</TABLE>
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Consolidated net sales for the three months ended October 31, 1995 totaled
$58,480,000, an increase of 24% when compared to sales of $47,360,000 for the
third quarter of 1994. Net income for the third quarter of 1995 was a record
high $4,680,000 ($.39 per share), which represents an increase of 41% compared
to net income of $3,325,000 ($.28 per share) for the corresponding 1994 period.
For the nine months ended October 31, 1995, consolidated net sales of
$174,280,000 reflect a 30% increase over sales of $133,710,000 for the
corresponding prior year period. Net income for the nine months of $13,575,000
($1.13 per share) was 59% greater than the comparable $8,525,000 ($.71 per
share) net income for the first nine months of 1994. Both the nine months'
sales and net income represent record highs for the Company. Expressed as a
return on sales, net income represents an 8% return for the third quarter and a
7.8% return for the year to date. Please note that the per share amounts used
throughout this report are based on the number of shares outstanding after the
100% stock dividend that was distributed to our shareholders on March 15, 1995.
The third quarter and nine months' sales increase over the prior year results
reflect the continuing high levels of shipments being experienced by the lift
truck industry in North America, increased sales in most of our European
markets and improved business conditions in a number of developing markets in
Asia and Latin America. Sales in Japan reflect a modest improvement over last
year's levels despite relatively soft market conditions.
The record high net income is the result of a number of factors including the
impact of increased sales volumes, improved operating efficiency at our new
manufacturing plant in The Netherlands, continued excellent performance of our
hydraulic cylinder operations in the United Kingdom and effective expense
control throughout the Company.
Other expenses for the first nine months of 1995 and 1994 includes charges of
$1,840,000 and $1,250,000 respectively, associated with environmental
evaluations and remediation activities. As previously reported, the Company has
initiated legal action against a number of insurers to enforce the terms of
their policies and to recover the Company's costs.
As previously announced at their meeting on November 9th, the Directors
authorized the repurchase of up to 400,000 shares of Cascade common stock from
time to time on the open market. Subsequent to October 31, 1995, the Company
purchased 81,800 shares at prices ranging from a low of $13.25 to a high of
$13.88 per share.
<PAGE>
During the third quarter the U.S. dollar strengthened modestly against most
foreign currencies affecting our financial consolidations. However, for the
nine months ended October 31, 1995 the U.S. dollar has weakened against both the
Dutch Guilder and the Canadian dollar. As a result, the adjustment for currency
translation in our financial statements reflects a decrease of $799,000 ($.07
per share) for the current quarter and an increase of $1,884,000 ($.16 per
share) for the nine months ended October 31, 1995.
LIQUIDITY AND CAPITAL RESOURCES
Over the preceding five years, expenditures for new facilities, machinery,
equipment and tooling have exceeded $50,000,000. Capital expenditures of
$9,037,000 have been recorded during the first nine months of this fiscal year.
This is lower than the $15,698,000 recorded during the corresponding period in
1994. A significant portion of the 1994 additions were expenditures for the
project to consolidate the production facilities of our Diemen and Amelo
factories and our European offices into one facility at Almere, The Netherlands.
Funding for this project was obtained from a bank in The Netherlands. Other
capital improvements have been funded from earnings.
No other significant shifts occurred in the balance sheet during the quarter.
The Company's total long and short-term debt to equity ratio was .20 to 1.00 and
working capital approximated $54,200,000 at October 31, 1995.
<PAGE>
CASCADE CORPORATION AND SUBSIDIARY COMPANIES
PART II
ITEM 1. LEGAL PROCEEDINGS
Neither the Company nor any of its subsidiaries are involved in any
material pending legal proceedings other than litigation incidental to
the regular course of business. The company and its subsidiaries are
adequately insured against product liability, personal injury and
property damage claims which may arise occasionally.
ITEM 2. CHANGES IN SECURITIES
None
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 5. OTHER INFORMATION
None
ITEM 6. EXHIBIT AND REPORTS ON FORM 8-K
During the quarter ended October 31, 1995, the company was not
required to file a Form 8-K with the commission.
<PAGE>
CASCADE CORPORATION AND SUBSIDIARY COMPANIES
SIGNATURES
The enclosed financial statements have not been certified by independent
accountants. However, to the best of my knowledge and belief these financial
statements have been prepared in conformity with generally accepted accounting
principles and on a basis substantially consistent with audited financial
statements included in the annual report filed with the Commission for the
preceding fiscal year.
The Company believes that all adjustments, consisting of normal recurring
adjustments, necessary for a fair statement of the results of operations, have
been included.
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CASCADE CORPORATION
December 4, 1995 /s/ G. M. BITZ
- --------------------- -----------------------------
Date G.M. Bitz
Vice President -- Finance
and Secretary
November 28, 1995 /s/ JAMES D. MILLER
- --------------------- -----------------------------
Date James P. Miller
Treasurer
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JAN-31-1996
<PERIOD-START> FEB-01-1995
<PERIOD-END> OCT-31-1995
<CASH> 22,620
<SECURITIES> 0
<RECEIVABLES> 41,738
<ALLOWANCES> 387
<INVENTORY> 25,147
<CURRENT-ASSETS> 89,766
<PP&E> 135,282
<DEPRECIATION> 70,807
<TOTAL-ASSETS> 156,861
<CURRENT-LIABILITIES> 0
<BONDS> 0
<COMMON> 6,196
0
0
<OTHER-SE> 94,558
<TOTAL-LIABILITY-AND-EQUITY> 156,861
<SALES> 174,280
<TOTAL-REVENUES> 174,280
<CGS> 114,470
<TOTAL-COSTS> 114,470
<OTHER-EXPENSES> 2,450
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 170
<INCOME-PRETAX> 20,765
<INCOME-TAX> 7,190
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 13,575
<EPS-PRIMARY> 1.13
<EPS-DILUTED> 1.13
</TABLE>
